Another View: US history points to economic solutions

The more things change, the French proverb says, the more they stay the same. It is exemplified by a re-reading of the classic work of history by Arthur S. Schlesinger Jr., "The Crisis Of The Old Order." We have excerpted some quotations from Schlesinger's book in this editorial.

Statements by some political "economists" who aspire to office, such as U.S. Rep. Paul Ryan, sound familiar. When the stock market crashed in 1929, President Herbert Hoover, a Republican, faced a horrendous financial mess that was caused in part by a lack of regulation in the economy.

Today's critics of Federal Reserve Chairman Ben Bernanke echo comments made by business leaders in the 1930s as the country fell into the Depression.

When asked by a Senate committee for possible solutions, Myron C. Taylor of U.S. Steel said he had "no remedy in mind" other than economic retrenchment and budget balancing. Others, such as former Treasury Secretary David F. Houston, then president of Mutual Life, recommended avoiding "unnecessary appropriations."

Edward Duffield of Prudential Insurance said, "The thing of primary importance is the balancing of the federal budget."

The economist Paul Block agreed: "First in importance is the balancing of our budget."

Will Clayton of Clayton and Anderson stated "balance the budget through a drastic reduction in the cost of government."

Sound familiar?

Campaigning for re-election in 1932, Hoover said his administration stood for the gold standard and a balanced budget. Hoover praised his predecessor, Calvin Coolidge, and pledged "further reductions in government spending." Hoover added that in certain matters concerning public lands the states were "more competent to manage much of these affairs than the federal government."

Shades of today's House of Representatives, which is trying to eliminate federal regulation or give regulatory power to the states. Listening to Kentucky Sen. Rand Paul, one can almost hear Hoover's appeals for laissez-faire. This is as close to the philosophy promoted by Paul and other libertarians as history can make it.

Hoover also called for an increase in taxes while denouncing government spending. At one time he had espoused a public works program to help the economy. He retreated from that position and felt that the growing federal debt "seemed a primary threat to recovery." He said that "prosperity cannot be restored by raids upon the public treasury." He was defeated by Franklin Roosevelt and the New Deal followed.

Hoover recognized that there were problems but he did not want them solved by government. But government alleviated the Depression.

Some people just refuse to profit by reading history.

The Journal Inquirer of Manchester (Conn.)

ADVERTISEMENT

ADVERTISEMENT

ADVERTISEMENT

Email this article

Another View: US history points to economic solutions

The more things change, the French proverb says, the more they stay the same. It is exemplified by a re-reading of the classic work of history by Arthur S. Schlesinger Jr., '